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To believers in sound money, treating US dollars as a safe-haven is a bit like seeking shelter from an electric storm in a tin-shack. After all, they point out, America is the world’s biggest debtor and may try to ease its burdens by repaying creditors in devalued dollars.

Nevertheless, old habits die hard. The US dollar is still the world’s most liquid currency and investors have been buying it again lately, in response to the looming crisis in Europe.

The US dollar index – which tracks the dollar’s performance against a handful of other leading currencies – has risen 5 per cent from its 2011 lows. Interestingly, its most recent trough at 72.64 conformed to its long-established pattern of forming turning-points at 38-week intervals. Going by its past experience, it could easily rise as far as its 200-week exponential average, currently at 80.25. But this is unlikely to prove to be the start of a new bull market in US dollars, in my view.

Sooner or later, the US is likely to embark on yet further money-printing activity, in order to keep asset prices inflated. This could well push the dollar index to new all-time lows below its 2008 trough at 70.70 – perhaps to 66.42